延长石油国际(00346) - 2025 - 中期业绩

Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Summary The Group reported a loss of HKD 27,847 thousand, with total revenue decreasing by 40.41% to HKD 9,994,518 thousand, despite reduced operating expenses | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Revenue | 9,994,518 | 16,771,559 | (6,777,041) | -40.41% | | Other Income | 3,560 | 5,482 | (1,922) | -35.06% | | Total Revenue and Other Income | 9,998,078 | 16,777,041 | (6,778,963) | -40.41% | | Total Expenses | (10,008,529) | (16,787,221) | 6,778,692 | -40.38% | | Operating Loss | (10,451) | (10,180) | (271) | -2.66% | | Finance Costs | (18,166) | (17,949) | (217) | -1.21% | | Loss Before Tax | (28,617) | (28,129) | (488) | -1.73% | | Taxation | 770 | 863 | (93) | -10.78% | | Loss for the Period | (27,847) | (27,266) | (581) | -2.13% | | Loss for the Period Attributable to Owners of the Company | (28,537) | (27,018) | (1,519) | -5.62% | | Basic and Diluted Loss Per Share (HK cents) | (2.59) | (2.46) | (0.13) | -5.28% | - Exchange differences in other comprehensive income improved from a HKD 37,621 thousand loss in 2024 to a HKD 76,831 thousand gain in 2025, boosting total comprehensive income[3] Condensed Consolidated Statement of Financial Position Summary Total assets increased to HKD 2,914,965 thousand, while net current liabilities shifted to HKD 216,900 thousand, indicating increased liquidity pressure | Indicator | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Non-current Assets | 1,990,953 | 1,926,237 | 64,716 | 3.36% | | Current Assets | 924,012 | 873,762 | 50,250 | 5.75% | | Total Assets | 2,914,965 | 2,799,999 | 114,966 | 4.11% | | Total Equity Attributable to Owners of the Company | 1,294,711 | 1,247,955 | 46,756 | 3.75% | | Non-controlling Interests | 54,452 | 52,224 | 2,228 | 4.27% | | Total Equity | 1,349,163 | 1,300,179 | 48,984 | 3.77% | | Current Liabilities | 1,140,912 | 816,878 | 324,034 | 39.67% | | Non-current Liabilities | 424,890 | 682,942 | (258,052) | -37.79% | | Total Liabilities | 1,565,802 | 1,499,820 | 65,982 | 4.40% | | Net Current (Liabilities)/Assets | (216,900) | 56,884 | (273,784) | -481.39% | Notes to the Financial Statements 1. Basis of Preparation The condensed consolidated financial statements are prepared in HKD, adhering to HKAS 34 and Listing Rules Appendix 16, with figures rounded to the nearest thousand - Statements are prepared in accordance with HKAS 34 and Listing Rules Appendix 16, presented in HKD, with figures rounded to the nearest thousand[6][7] 2. Principal Accounting Policies Financial statements are prepared on a historical cost basis, with some assets at fair value; new HKAS 21 amendment had no material impact - Statements are prepared on a historical cost basis, with some assets measured at fair value[8] - First application of HKAS 21 (Amendment) — Lack of Exchangeability had no significant impact[8] - New or revised HKFRSs effective in the future but not yet adopted are listed, including HKFRS 18[9] 3. Segment Information The Group operates in Canadian oil and gas (turned to loss) and China oil products trading (turned to profit), with revenue highly dependent on key customers - The Group operates in two segments: Exploration, Development and Production (Oil and Gas) and Supply and Procurement (Oil Products Trading)[10][12] Segment Revenue and Results (For the six months ended June 30) | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Exploration, Development and Production | | | | | | Sales to External Customers | 94,132 | 189,103 | (94,971) | -50.22% | | Segment (Loss)/Profit | (34,261) | 7,932 | (42,193) | -531.93% | | Supply and Procurement | | | | | | Sales to External Customers | 9,900,386 | 16,582,456 | (6,682,070) | -40.29% | | Segment (Loss)/Profit | 2,368 | (1,597) | 3,965 | 248.28% | | Consolidated | | | | | | Sales to External Customers | 9,994,518 | 16,771,559 | (6,777,041) | -40.41% | | Operating Loss | (10,451) | (10,180) | (271) | -2.66% | | Loss for the Period | (27,847) | (27,266) | (581) | -2.13% | 3.1 Segment Revenue and Results Exploration, Development and Production revenue decreased 50.22%, turning to a HKD 34,261 thousand loss, while Supply and Procurement revenue decreased 40.29%, turning to a HKD 2,368 thousand profit - Exploration, Development and Production revenue decreased by 50.22%, turning from a HKD 7,932 thousand profit to a HKD 34,261 thousand loss[11] - Supply and Procurement revenue decreased by 40.29%, but turned from a HKD 1,597 thousand loss to a HKD 2,368 thousand profit[11] 3.2 Segment Assets and Liabilities Both assets and liabilities increased for the Exploration, Development and Production and Supply and Procurement segments, reflecting structural changes Segment Assets and Liabilities (As of June 30) | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Segment Assets | | | | | | Exploration, Development and Production | 1,794,116 | 1,741,246 | 52,870 | 3.04% | | Supply and Procurement | 1,099,728 | 1,033,640 | 66,088 | 6.40% | | Segment Liabilities | | | | | | Exploration, Development and Production | 507,016 | 497,991 | 9,025 | 1.81% | | Supply and Procurement | 877,153 | 819,523 | 57,630 | 7.03% | 3.3 Information about Major Customers Supply and Procurement revenue is highly concentrated, with Customers A and B contributing most in H1 2025, while Customer C had no contribution - In the first half of 2025, two major customers contributed HKD 6,759,787 thousand to Supply and Procurement revenue[15] Revenue from Major Customers (For the six months ended June 30) | Customer | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | A Customer | 5,628,444 | 8,679,176 | | B Customer | 1,131,343 | – | | C Customer | – | 3,772,969 | 4. Revenue and Other Income Total revenue decreased by 40.41% to HKD 9,994,518 thousand, mainly from reduced petroleum product trading, with other income also declining Revenue and Other Income (For the six months ended June 30) | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Revenue | | | | | | Sales of Crude Oil and Natural Gas | 94,132 | 189,103 | (94,971) | -50.22% | | Trading and Distribution of Petroleum-related Products | 9,900,386 | 16,582,456 | (6,682,070) | -40.29% | | Total Revenue | 9,994,518 | 16,771,559 | (6,777,041) | -40.41% | | Other Income | | | | | | Bank Interest Income | 1,759 | 3,124 | (1,365) | -43.69% | | Rental Income | 634 | 698 | (64) | -9.17% | | Others | 1,167 | 1,660 | (493) | -29.70% | | Total Other Income | 3,560 | 5,482 | (1,922) | -35.06% | - Revenue is recognized at a point in time in accordance with HKFRS 15[18] 5. Other Gains and Losses The Group reported a net exchange gain of HKD 24,577 thousand, a significant improvement from the prior year's exchange loss Other Gains and Losses (For the six months ended June 30) | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | | :--- | :--- | :--- | :--- | | Net Exchange Gains/(Losses) | 24,577 | (15,219) | 39,796 | | Others | – | (28) | 28 | | Total | 24,577 | (15,247) | 39,824 | 6. Items Deducted from Operating Loss Cost of inventories sold, depreciation, and depletion expenses significantly decreased, while staff costs, including directors' emoluments, increased Items Deducted from Operating Loss (For the six months ended June 30) | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Cost of Inventories Sold | 9,869,666 | 16,547,797 | (6,678,131) | -40.36% | | Depreciation and Depletion Expenses | 59,755 | 96,649 | (36,894) | -38.17% | | Staff Costs | 38,767 | 35,268 | 3,499 | 9.92% | 7. Finance Costs Finance costs slightly increased by 1.21% to HKD 18,166 thousand, driven by new other loan interest, despite lower bank and secured loan interest Finance Costs (For the six months ended June 30) | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Interest Expense on Bank Borrowings and Secured Term Loans | 13,522 | 14,323 | (801) | -5.59% | | Interest Expense on Lease Liabilities | 1,455 | 2,262 | (807) | -35.68% | | Interest Expense on Other Loans | 1,845 | – | 1,845 | N/A | | Accrued Provision for Abandonment Obligations | 1,344 | 1,364 | (20) | -1.47% | | Total | 18,166 | 17,949 | 217 | 1.21% | 8. Income Tax in the Consolidated Statement of Profit or Loss The Group recorded a HKD 770 thousand tax credit, mainly from an over-provision of China enterprise income tax, partially offset by Hong Kong profits tax under-provision - Tax credit of HKD 770 thousand in H1 2025, primarily from an over-provision of HKD 796 thousand for China enterprise income tax[23][24] - Hong Kong profits tax rate is 16.5%, while Canadian and Chinese subsidiaries' tax rates are both 25%[23] 9. Interim Dividend The Board does not recommend any interim dividend for the six months ended June 30, 2025, consistent with the prior year - The Board does not recommend the payment of an interim dividend for H1 2025[25] 10. Loss Per Share Basic and diluted loss per share attributable to owners of the Company increased to HK cents 2.59, with no dilutive potential ordinary shares Loss Per Share (For the six months ended June 30) | Indicator | 2025 (HK cents) | 2024 (HK cents) | Change (HK cents) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Basic and Diluted Loss Per Share | (2.59) | (2.46) | (0.13) | -5.28% | - Diluted loss per share is the same as basic loss per share due to no dilutive potential ordinary shares[28] 11. Trade Receivables Total trade receivables increased by 21.78% to HKD 557,460 thousand, with overdue amounts over 90 days significantly rising, yet deemed not credit impaired - Trade receivables generally have a credit period of up to 90 days and are interest-free[29] Ageing Analysis of Trade Receivables (As of June 30) | Ageing | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | 0 to 30 Days | 507,147 | 434,230 | 72,917 | 16.79% | | 31 to 60 Days | 175 | 385 | (210) | -54.55% | | 61 to 90 Days | 66 | 688 | (622) | -90.41% | | Over 90 Days | 50,072 | 22,455 | 27,617 | 123.00% | | Total | 557,460 | 457,758 | 99,692 | 21.78% | - Overdue but not impaired trade receivables amounted to HKD 50,072 thousand, a significant increase from HKD 22,455 thousand at the end of 2024[30][31] 12. Trade and Other Payables Total trade and other payables decreased by 13.01% to HKD 565,613 thousand, mainly due to reduced contract liabilities and VAT payables Trade and Other Payables (As of June 30) | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Trade Payables | 438,730 | 468,732 | (30,002) | -6.40% | | Contract Liabilities | 38,178 | 75,965 | (37,787) | -49.74% | | VAT Payables | 58 | 11,059 | (11,001) | -99.48% | | Other Payables | 73,893 | 74,093 | (200) | -0.27% | | Total | 565,613 | 650,214 | (84,601) | -13.01% | - Contract liabilities primarily represent customer advances, expected to be fully recognized as revenue within one year[32] - Trade payables are interest-free, with an average credit period of up to 90 days[33] 13. Contingent Liabilities The Group had no significant contingent liabilities as of June 30, 2025, consistent with the prior year-end - The Group had no significant contingent liabilities as of June 30, 2025[34] 14. Significant Related Party Transactions The Group engaged in various related party transactions, mainly for petroleum product procurement and loan interest, with key management personnel compensation increasing by 18.47% Key Management Personnel Compensation (For the six months ended June 30) | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (HKD thousands) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Salaries, Bonuses and Allowances | 8,730 | 7,360 | 1,370 | 18.61% | | Pension Scheme Contributions | 127 | 116 | 11 | 9.48% | | Total | 8,857 | 7,476 | 1,381 | 18.47% | Related Party Transactions (For the six months ended June 30) | Relationship | Nature of Transaction | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | :--- | | Ultimate Holding Company | Procurement of Refined Oil and By-products | 3,628,421 | 5,747,594 | | Fellow Subsidiaries | Procurement of Refined Oil and By-products | 78,666 | 1,711,923 | | Fellow Associates | Procurement of Refined Oil and By-products | 450 | 20,091 | | Fellow Associates | Sales of Refined Oil and By-products | – | 27,817 | | Direct Holding Company | Interest Expense on Secured Term Loans | 12,148 | 11,182 | | Ultimate Holding Company | Interest Expense on Other Loans | 1,845 | 2,992 | - Henan YanChang entered into a supply agreement with YanChang Petroleum Group for the procurement of refined oil and by-products[37] Management Discussion and Analysis Business Review and Outlook International oil prices declined to USD 68/barrel in H1 2025, leading to a HKD 27.9 million Group loss, mainly from Canadian oil and gas operations - International oil prices declined due to geopolitical factors and tariff wars, with WTI crude oil averaging USD 68/barrel in H1 2025, down from USD 77/barrel in 2024[38][39] - The Group's overall loss in H1 was approximately HKD 27.9 million, primarily due to the performance of its Canadian oil and gas business[39] Canadian Producing Oil and Gas Upstream Business Novus faced declining oil prices and tight financing, resulting in a 37% production drop, 50% revenue decrease, and CAD 4.92 million net loss, prompting cost control and green tech exploration - Novus's net oil and gas production in H1 was 263,000 barrels of oil equivalent, a 37% year-on-year decrease; sales revenue was CAD 16.4 million, a 50% year-on-year decrease; and a net loss of CAD 4.92 million was recorded[40] - Capital expenditure significantly decreased to CAD 831 thousand, a 75% year-on-year decrease, slowing development progress[40] Actively Responding to Production Decline, Continuously Optimizing Production and Operating Expenses Novus effectively controlled operating expenses by rapidly restoring production, pre-purchasing carbon credits, optimizing structure, and negotiating lower rent and insurance - Rapidly restored daily average production of 184 barrels lost due to extreme cold weather[41] - Saved CAD 26 thousand by pre-purchasing carbon credits, reduced labor costs by CAD 1.82 million, compressed operating costs by CAD 35 thousand, and lowered office rent and insurance by CAD 77 thousand[41] Efficiently Organizing Production Operations, Effectively Improving Operational Efficiency Novus maintained stable production and efficiency by optimizing construction, adjusting inventory, and responding to weather, limiting Q1-Q2 production decline to 2% - Flexibly adjusted inventory strategies to ensure market supply and maximize profit amidst international oil and natural gas price fluctuations[42] - Rapidly completed pipeline de-icing and well pad snow removal, achieving only a 2% production decline from Q1 to Q2[42] Promoting Refined Oilfield Management, Continuously Implementing Cost Reduction and Efficiency Improvement Novus saved CAD 567 thousand in H1 by controlling expenses and carbon emissions, while implementing 52 production enhancement measures, increasing daily output by 103 barrels - Cumulative savings of CAD 567 thousand in H1, with an estimated CAD 1.96 million in annual savings[43] - Implemented 52 production enhancement measures, increasing daily average production by 103 barrels, effectively curbing the decline trend of old wells[43] - Field operating expenses decreased by 7.7% to CAD 7.92 million, and administrative expenses decreased by 14.8% to CAD 2.93 million[43] Strengthening Medium-to-Long-Term Planning Research, Supporting Healthy and Sustainable Oilfield Development Novus developed a five-year plan with economic models for various oil price scenarios, exploring carbon capture and AI applications for sustainable development - Conducted a "Novus Oilfield Five-Year Development Plan Study", building economic models under different WTI oil price scenarios[44] - Explored the feasibility of carbon capture and storage projects to expand green and low-carbon development[44] - Explored the application of AI technology in oilfield production management[44] Actively Expanding Mineral Rights Area, Enhancing Company's Resource Security Capability Novus evaluated non-core blocks and proposed a Wapiti block disposal plan to optimize asset structure and enhance resource diversity and risk resilience - Proposed a Wapiti block disposal plan to optimize asset structure and enhance resource diversity and risk resilience[45] Strictly Managing Safety Production, Fully Fulfilling Environmental Compliance Obligations Novus prioritized safety by strengthening management and training, while strictly complying with Canadian environmental laws, implementing emission reductions, and remediating abandoned wells - Strengthened on-site safety management systems and regularly conducted employee safety training and emergency drills[46] - Strictly complied with Canadian environmental laws and regulations, actively implemented emission reduction responsibilities, and pre-built natural gas pipelines to reduce flaring emissions[46] - Diligently fulfilled abandoned well remediation responsibilities, completing government-assigned tasks on schedule[46] China Oil Products Sales Downstream Business Henan YanChang's retail and external sales businesses faced reduced profits and sales due to market pressures, resulting in a 36% sales volume drop, 41% revenue decrease, and RMB 2.1 million net profit - Henan YanChang's total sales volume in H1 was 1.3614 million tonnes, a 36% year-on-year decrease; operating revenue was RMB 9.062 billion, a 41% year-on-year decrease; and net profit was RMB 2.1 million[47] - Retail business experienced narrow profits and decreased sales due to price adjustments, price caps, price wars, and new energy alternatives[47] - External procurement and sales business scaled down due to the exclusion of risky businesses and reduced centralized procurement by Sinopec[47] Steady and Effective Business Advancement Henan YanChang expanded its retail membership to 110,000, explored fixed investment and LNG businesses, and developed new merchants, laying groundwork for future growth - Promoted retail membership system construction, reaching 110,000 members, with 3,000 new enterprise WeChat members[48] - Actively organized research on Sinopec Shiyan area gas station fixed investment business and engaged in fixed investment business with private customers[48] - Conducted LNG business feasibility studies, laying the foundation for future business development[49] Strengthened Business Assurance Henan YanChang optimized personnel, streamlined processes, and reformed its retail system, while securing tax reductions totaling RMB 40.2 thousand through various initiatives - Completed open selection and appointment of 10 department heads, 8 deputy department heads, and dual-choice positions for 157 grassroots employees[50] - Optimized authority and responsibility processes, implemented SOPs, focusing on optimizing modules such as merchant management, logistics management, and external warehouse management[50] - Successfully secured a 2% reduction in urban construction tax rate and simplified collection for warehousing services, saving RMB 14.2 thousand and RMB 12.1 thousand in taxes in H1[50] Continuously Consolidating Safety Foundation Henan YanChang achieved a low-risk safety rating for its storage base, hosted emergency drills, and completed 1,551 safety trainings with 100% frontline employee coverage - Large oil and gas storage base safety risk self-assessment scored 910 points, rated as low risk[51] - Hosted a comprehensive emergency rescue drill for hazardous chemical production safety accidents in Xinzheng City[51] - Conducted 1,551 safety production training sessions in H1, with 100% coverage for frontline employees; all 185 safety hazards have been rectified[51] Outlook Global energy market uncertainty and geopolitical factors will constrain oil prices in H2; the company plans to innovate, optimize sales, and diversify for sustainable growth - Global energy market uncertainty remains high in H2, with geopolitical conflicts and slowing global economic growth continuing to impact oil prices[52] - The Company will deepen technological innovation in exploration and development to improve oil and gas resource recovery efficiency[53] - Adhere to a diversified development strategy, exploring new businesses to achieve sustainable development[53] Financial Review Segment Revenue and Results Group revenue from Canadian oil and gas (now a loss) and China oil product trading (now a profit) saw significant declines in sales volume and revenue - Novus's oil and natural gas sales volume was 263,010 barrels of oil equivalent, with revenue of HKD 94,132 thousand, representing year-on-year decreases of 42.4% and 50.2% respectively[54] - Novus generated an operating loss of HKD 34,261 thousand, compared to an operating profit of HKD 7,932 thousand in the prior year[54] - China oil product trading business sales volume decreased from 2.13 million tonnes to 1.36 million tonnes, and revenue decreased from HKD 16,582,456 thousand to HKD 9,900,386 thousand[55] Other Income Other income decreased by HKD 1,922 thousand to HKD 3,560 thousand, mainly from bank interest, fuel card income, and rent - Other income was HKD 3,560 thousand, a year-on-year decrease of HKD 1,922 thousand, primarily from bank interest, fuel card income, and rent[56] Royalty Fees Royalty fees decreased by 28.53% to HKD 15,574 thousand, primarily due to reduced Novus revenue - Royalty fees were HKD 15,574 thousand, a year-on-year decrease of 28.53%, mainly due to reduced Novus revenue[57] Oilfield Operating Expenses Oilfield operating expenses decreased by 7.13% to HKD 45,495 thousand, primarily due to reduced Novus production and sales volume - Oilfield operating expenses were HKD 45,495 thousand, a year-on-year decrease of 7.13%, primarily due to reduced Novus production and sales volume[58] Exploration and Evaluation Expenses Exploration and evaluation expenses were HKD 1,271 thousand, mainly holding costs for Novus's non-producing land interests - Exploration and evaluation expenses were HKD 1,271 thousand, primarily representing holding costs for Novus's non-producing land interests[59] Selling and Distribution Expenses Selling and distribution expenses significantly decreased by 61.00% to HKD 7,033 thousand, mainly from Henan YanChang's oil trading business - Selling and distribution expenses were HKD 7,033 thousand, a year-on-year decrease of 61.00%, primarily from Henan YanChang's oil product trading business[60] Administrative Expenses Administrative expenses decreased by 8.32% to HKD 34,312 thousand, covering directors' emoluments, staff salaries, office rent, and professional fees - Administrative expenses were HKD 34,312 thousand, a year-on-year decrease of 8.32%[61] Depreciation, Depletion and Amortization Depreciation, depletion, and amortization expenses decreased by 38.17% to HKD 59,755 thousand, mainly due to reduced Novus production and sales volume - Depreciation, depletion and amortization expenses were HKD 59,755 thousand, a year-on-year decrease of 38.17%, primarily due to reduced Novus production and sales volume[62] Other Gains and Losses - Financial Review The Group recorded other gains of HKD 24,577 thousand, primarily net exchange gains, contrasting with a prior year loss - Other gains were HKD 24,577 thousand, representing net exchange gains, compared to a loss in the prior year[63] Finance Costs - Financial Review Total finance costs were HKD 18,166 thousand, slightly higher than prior year, including interest on bank borrowings, secured loans, and lease liabilities - Finance costs were HKD 18,166 thousand, slightly higher than the prior year, primarily including interest on bank borrowings, secured term loans, lease liabilities, other loans, and abandonment provision[64] Taxation The Group recorded a HKD 770 thousand tax credit, mainly from China enterprise income tax over-provision offsetting Hong Kong profits tax under-provision - Tax credit of HKD 770 thousand, primarily from an over-provision of HKD 796 thousand for China enterprise income tax, offsetting an under-provision of HKD 26 thousand for Hong Kong profits tax[65] Loss for the Period The Group's overall loss was HKD 27,847 thousand, with Novus incurring a HKD 28,250 thousand loss, while Henan YanChang maintained a HKD 2,300 thousand profit - The Group's loss for the period was HKD 27,847 thousand, with Novus incurring a HKD 28,250 thousand loss, and Henan YanChang maintaining a HKD 2,300 thousand profit[66] Liquidity and Financial Resources The Group funds operations via internal resources and loans; cash was HKD 240,015 thousand, gearing 116.1%, and current ratio 81.0%, indicating increased liquidity pressure - The Group primarily funds its operations through internal resources, bank borrowings, unsecured other loans, and secured term loans[67] - As of June 30, 2025, cash and bank balances were HKD 240,015 thousand, a decrease from HKD 278,675 thousand at the end of 2024[70] - Gearing ratio was 116.1%, current ratio was 81.0%, lower than 107.0% at the end of 2024, indicating increased liquidity pressure[70] Treasury Management and Policies The Group employs prudent cash management to minimize currency and interest rate risks, holding cash in multiple currencies without hedging, but will act if needed - The Group adopts prudent cash management and risk monitoring policies aimed at minimizing foreign currency exchange rate and interest rate fluctuation risks[71] - Cash is primarily held in short-term deposits denominated in HKD, USD, CAD, and RMB[71] - The Group has not undertaken foreign exchange hedging transactions, but management will take measures when deemed appropriate[71] Material Acquisitions and Disposals The Group had no material acquisitions or disposals during the six months ended June 30, 2025 - The Group had no material acquisitions or disposals in H1 2025[72] Material Investments The Group held no material investments as of June 30, 2025 - The Group held no material investments as of June 30, 2025[73] Capital Commitments Capital commitments totaled HKD 462 thousand for property, plant, and equipment purchases, contracted but not yet provided for - Capital commitments amounted to HKD 462 thousand, related to the purchase of property, plant and equipment, contracted but not yet provided for[74] Pledge of Assets Novus's secured term loan is collateralized by debentures and a floating charge, while the Company's loan is guaranteed by 70% of Henan YanChang's issued share capital - Novus's USD 35 million secured term loan is collateralized by USD 70 million debentures and a floating charge over all Novus's assets[75] - The Company's USD 22 million secured term loan is guaranteed by 70% of Henan YanChang's issued share capital[75] Contingent Liabilities - Financial Review The Group had no significant contingent liabilities as of June 30, 2025 - The Group had no significant contingent liabilities as of June 30, 2025[77] Bankruptcy Progress of a Non-Wholly Owned Chinese Subsidiary A 51%-owned Chinese subsidiary was declared bankrupt in June 2025, but its non-consolidation since 2023 means no material impact on the Group - YanChang Petroleum (Zhejiang Free Trade Zone) Co., Ltd. was declared bankrupt and its liquidation procedures terminated in June 2025[78] - The subsidiary ceased to be consolidated in 2023, so its bankruptcy has no material impact on the Group's current operations, performance, or financial position[78] Other Information Employees and Remuneration Policy The Group had 203 employees with total staff costs of HKD 38,767 thousand (up 9.92%), guided by fair, incentive-based remuneration policies, and no share options granted - The Group had a total of 203 employees, with total staff costs of HKD 38,767 thousand, a year-on-year increase of 9.92%[79] - Remuneration policy is based on fairness, incentives, performance, and market practices, providing benefits such as provident funds and medical insurance[79] - No share options were granted in H1 2025[79] Interim Dividend - Other Information The Board does not recommend any interim dividend for the six months ended June 30, 2025, consistent with the prior year - The Board does not recommend the payment of an interim dividend for H1 2025[80] Purchase, Sale or Redemption of the Company's Listed Securities Neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities in H1 2025 - The Group did not purchase, sell, or redeem any listed securities in H1 2025[81] Corporate Governance Practices The Board adheres to high corporate governance standards, largely complying with Listing Rules, but notes deviations in independent director tenure, meeting attendance, and role separation - The Board is committed to high standards of corporate governance, aiming to enhance transparency, independence, accountability, responsibility, and fairness[82] - Independent non-executive directors have served for over nine years, and the Company is seeking new candidates[82] - Non-executive Director Ms. Lu Yiwen did not attend the Annual General Meeting[85] - The roles of Chairman and Chief Executive are not separated, but the Board believes the balance of power under existing arrangements is not impaired[85] Audit Committee The Audit Committee, composed of three independent non-executive directors, reviewed the Company's accounting principles and interim financial statements - The Audit Committee, comprising three independent non-executive directors, has reviewed the Company's accounting principles, policies, and interim financial statements[83] Continuing Connected Transactions The Group has continuing connected transactions, mainly for petroleum product procurement and sales with related parties, complying with Listing Rules Chapter 14A - Henan YanChang has continuing connected transactions with YanChang Petroleum Group and its fellow subsidiaries for the procurement and sale of refined oil and by-products[84][86] - Disclosure requirements of Listing Rules Chapter 14A have been complied with[87] Standard Code for Securities Transactions by Directors The Company adopted the Listing Rules Appendix 10 Standard Code, and all Directors confirmed compliance for H1 2025 - The Company has adopted the Standard Code as set out in Listing Rules Appendix 10, and Directors confirmed compliance[88] Publication of Interim Results Announcement and Interim Report The interim results announcement is published on HKEX and company websites; the interim report will be dispatched to shareholders and posted online - The interim results announcement has been published on the HKEX website and the Company's website[89] - The interim report will be dispatched to shareholders and posted on the websites in due course[89] By Order of the Board This announcement is published by Mr. Feng Yinguo, Chairman of the Board, on behalf of the Board, listing all directors - The announcement is published by Mr. Feng Yinguo, Chairman of the Board, on behalf of the Board[90]